How Technology Is Revolutionising Compliance

For financial services firms, compliance has traditionally been a significant challenge, with complex regulations and high costs making it difficult to ensure that all requirements are met.

The role of technology in compliance is therefore becoming increasingly important as regulatory requirements become more complex and demanding. Compliance technology will continue to evolve fast to support the industry and we expect innovation to continue at a fast pace, facilitating automation and business efficiency.

Our point of view is that the following key technology developments will be shaping this growth and evolution:

-AI and machine learning: The analytical power to analyse massive amounts of data close to real time will significantly improve efficiency. The news with GPT4 show how quickly AI is progressing and that it is likely to strongly impact all aspects of work.

-Platform approach: Instead of working with several vendors, we’ll see a move towards integrated, end-to-end platforms that can cover all compliance needs. A modular approach and a level of customisation will help support these comprehensive solutions. Indeed, increased inter-operability means an integrated platform will ensure a smooth and seamless management.

-Blockchain: Blockchain can support the need for a secure and tamper-proof record of transactions. It is likely to remain a niche use case but an important one. An example is the CBDC (Central Bank Digital Currency) trialed by the RBA, which could have an impact on assets trading.

-Cloud Computing: This is not a new trend and is often complemented by edge computing. However, we expect cloud-based solutions to become ubiquitous so users can access services on-demand, reducing the need for infra-structure. This supports the move to SaaS compliance management solutions.

When combined, these technological developments will help drive a new age in Regtech overall and compliance management solutions in particular.

The global regtech market is expected to reach $55.28 billion by 2025, with a compound annual growth rate (CAGR) of 23.5% from 2018 to 2025, according to Allied Market Research.

To support this growth, we expect regtech solutions to become even more sophisticated and integrated with core business processes, rather than a separate function.

We also expect the skill set to shift to analytics, as the software will deal with most of the day-to-day management, freeing users’ time. This will also require a stronger emphasis on data quality and management.

Lastly, we expect the amount of regulations to continue to increase in both quantity and complexity, in turn requiring more collaboration between compliance managers and vendors to ensure that compliance management platforms stay on top and are updated seamlessly.

To summarise, the regtech industry is fast growing and evolving, driven by the need for businesses to comply with regulatory requirements. The role of technology in compliance is becoming increasingly important as regulatory requirements become more complex and demanding.

About Complii Fintech Solutions: a one-stop-shop complete risk and compliance platform with a modular approach and customisation.

Our secure digital platform is based on customisable software designed to automate, record and report on an AFS Licensee’s and Brokers compliance obligations.

Complii automates functions such as sending ROA’s/SOA’s emails based off client profiles, 708 8 expiry register, FOFA FDS letter auto-generation and electronic opt-in, online client profiles updates, disclosures, breach register, Chinese walls, internal compliance and much more.